How to Calculate Lighting Savings

When you switch from an older outdated lamp to a newer model, the hope is to save money on lighting costs. While you may know that switching to a lamp with better efficiency will save on lighting costs, the matter of figuring out exactly how much you’re saving can seem overwhelming. Let’s take a look at how to calculate lighting savings to make this easier to figure out on your end.

In order to know how to calculate lighting savings, you don’t need an advanced degree or extensive experience in construction to get the answer. It is a simple math equation any business owner or homeowner should be able to compute.

Step 1. Collect the information.

You will need to gather some basic information before we get started.

  • Wattage of old lamps: For this example, let’s say 90 watts.
  • Wattage of new lamps: For this example, let’s say 14 watts.
  • Run time:
    • How many hours a day is the lamp used? We will use 12 hours in this example.
    • How many days per year is the lamp used? Assuming a few holidays of nonuse, we will go with 360 days for our equation.
  • Electricity rate: This can be difficult to figure because it depends on the utility rate being paid in the area and varies from state to state, but a reasonable national average is $0.10/kWh to $0.14/kWh. We will use $0.12/kWh as a middle ground figure in our example.

Step 2. Figure out savings per lamp.

You always want to look at savings per lamp to get the most accurate answer. So, our equation will look like this:

Old Lamp Wattage minus New Lamp Wattage = Energy Saved Per Lamp
90 Watts minus 14 Watts = 76 Watts Saved Per Lamp

Step 3. Figure out the annual run time.

Knowing the savings per lamp is only part of the problem. You also need to factor in the run time to get the right answer. Our equation for this will look like this:

Daily Run Time x Annual Days of Use = Total Annual Run Time
12 Hours a Day x 360 days = 4,320 Hours Total

Step 4. Figure out total energy savings.

Now, you can do the next step of factoring in the cost of electricity to power the lamps for the specified hours. We will use 1000 to convert watts to kilowatts to make this part easier. The equation will look like this:

Energy Saved Per Lamp times Total Annual Run Time divided by 1000 = Total Energy
76 Watts Per Lamp times 4,320 hours divided by 1000 = 328 kWh Saved

Step 5. Translate to dollar amount.

Knowing how much energy your saving is great but seeing it in a dollar amount makes even more diffidence for most people. For this step, our equation will look like this:

Total Energy Saved x Electricity Rate = Dollars Saved
328 kWh Saved x $0.12/kWh = $39.36 Saved Per Lamp

This example of working out the savings on lighting costs when switching to a more efficient wattage is basic and can be adjusted to your needs by plugging in your own numbers based on your products.